SITE Centers Corp. 10-Q

10-Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 1-11690 SITE Centers Corp. (Exact name of registrant as specified in its charter) Ohio 34-1723097 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) 3300 Enterprise Parkway Beachwood , OH 44122 (Address of principal executive offices) (Zip Code) Registrant’s telephone number, including area code: ( 216 ) 755-5500 Securities registered pursuant to Section 12(b) of the Act: Title of each class Trading Symbol(s) Name of each exchange on which registered Common Shares , Par Value $ 0.10 Per Share SITC New York Stock Exchange Depositary Shares, each representing 1/20 of a share of 6.375% Class A Cumulative Redeemable Preferred Shares without Par Value SITC PRA New York Stock Exchange Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐ Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐ Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. Large accelerated filer ☒ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☐ Emerging growth company ☐ If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐ Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒ As of April 26, 2023 the registrant had 209,258,120 shares of common stock, $0.10 par value per share, outstanding. SITE Centers Corp. QUARTERLY REPORT ON FORM 10-Q QUARTER ENDED March 31, 2023 TABLE OF CONTENTS PART I. FINANCIAL INFORMATION Item 1. Financial Statements – Unaudited Consolidated Balance Sheets as of March 31, 2023 and December 31, 2022 3 Consolidated Statements of Operations for the Three Months Ended March 31, 2023 and 2022 4 Consolidated Statements of Comprehensive Income for the Three Months Ended March 31, 2023 and 2022 5 Consolidated Statements of Equity for the Three Months Ended March 31, 2023 and 2022 6 Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2023 and 2022 7 Notes to Condensed Consolidated Financial Statements 8 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 15 Item 3. Quantitative and Qualitative Disclosures about Market Risk 29 Item 4. Controls and Procedures 30 PART II. OTHER INFORMATION Item 1. Legal Proceedings 31 Item 1A. Risk Factors 31 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 31 Item 3. Defaults Upon Senior Securities 31 Item 4. Mine Safety Disclosures 31 Item 5. Other Information 31 Item 6. Exhibits 32 SIGNATURES 33 2 SITE Centers Corp. CONSOLIDATED B ALANCE SHEETS (unaudited; in thousands, except share amounts) March 31, 2023 December 31, 2022 Assets Land $ 1,073,726 $ 1,066,852 Buildings 3,755,415 3,733,805 Fixtures and tenant improvements 592,009 576,036 5,421,150 5,376,693 Less: Accumulated depreciation ( 1,696,184 ) ( 1,652,899 ) 3,724,966 3,723,794 Construction in progress and land 57,276 56,466 Total real estate assets, net 3,782,242 3,780,260 Investments in and advances to joint ventures, net 45,577 44,608 Cash and cash equivalents 25,034 20,254 Restricted cash 425 960 Accounts receivable 59,857 63,926 Other assets, net 140,050 135,009 $ 4,053,185 $ 4,045,017 Liabilities and Equity Unsecured indebtedness: Senior notes, net $ 1,454,462 $ 1,453,923 Term loan, net 198,605 198,521 Revolving credit facility 75,000 — 1,728,067 1,652,444 Mortgage indebtedness, net 54,201 54,577 Total indebtedness 1,782,268 1,707,021 Accounts payable and other liabilities 195,825 214,985 Dividends payable 30,081 30,389 Total liabilities 2,008,174 1,952,395 Commitments and contingencies SITE Centers Equity Class A— 6.375 % cumulative redeemable preferred shares, without par value, $ 500 liquidation value; 750,000 shares authorized; 350,000 shares issued and outstanding at March 31, 2023 and December 31, 2022 175,000 175,000 Common shares, with par value, $ 0.10 stated value; 300,000,000 shares authorized; 214,372,008 and 214,371,498 shares issued at March 31, 2023 and December 31, 2022, respectively 21,437 21,437 Additional paid-in capital 5,966,089 5,974,216 Accumulated distributions in excess of net income ( 4,061,167 ) ( 4,046,370 ) Deferred compensation obligation 5,055 5,025 Accumulated other comprehensive income 5,838 9,038 Less: Common shares in treasury at cost: 5,386,964 and 3,787,279 shares at March 31, 2023 and December 31, 2022, respectively ( 73,035 ) ( 51,518 ) Total SITE Centers shareholders' equity 2,039,217 2,086,828 Non-controlling interests 5,794 5,794 Total equity 2,045,011 2,092,622 $ 4,053,185 $ 4,045,017 The accompanying notes are an integral part of these condensed consolidated financial statements. 3 SITE Centers Corp. CONSOLIDATED STA TEMENTS OF OPERATIONS (unaudited; in thousands, except per share amounts) Three Months Ended March 31, 2023 2022 Revenues from operations: Rental income $ 135,872 $ 129,884 Fee and other income 2,820 4,436 138,692 134,320 Rental operation expenses: Operating and maintenance 23,166 21,936 Real estate taxes 20,053 20,183 General and administrative 10,645 12,251 Depreciation and amortization 54,016 50,364 107,880 104,734 Other income (expense): Interest expense ( 19,923 ) ( 18,258 ) Other income (expense), net ( 687 ) ( 504 ) ( 20,610 ) ( 18,762 ) Income before earnings from equity method investments and other items 10,202 10,824 Equity in net income of joint ventures 1,359 169 Gain on sale and change in control of interests 3,749 3,356 Gain (loss) on disposition of real estate, net 205 ( 142 ) Income before tax expense 15,515 14,207 Tax expense of taxable REIT subsidiaries and state franchise and income taxes ( 213 ) ( 252 ) Net income $ 15,302 $ 13,955 Income attributable to non-controlling interests, net ( 18 ) ( 18 ) Net income attributable to SITE Centers $ 15,284 $ 13,937 Preferred dividends ( 2,789 ) ( 2,789 ) Net income attributable to common shareholders $ 12,495 $ 11,148 Per share data: Basic $ 0.06 $ 0.05 Diluted $ 0.06 $ 0.05 The accompanying notes are an integral part of these condensed consolidated financial statements. 4 SITE Centers Corp. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (unaudited; in thousands) Three Months Ended March 31, 2023 2022 Net income $ 15,302 $ 13,955 Other comprehensive income: Change in fair value of interest-rate contracts ( 3,200 ) — Total other comprehensive income ( 3,200 ) — Comprehensive income $ 12,102 $ 13,955 Comprehensive income attributable to non-controlling interests ( 18 ) ( 18 ) Total comprehensive income attributable to SITE Centers $ 12,084 $ 13,937 The accompanying notes are an integral part of these condensed consolidated financial statements. 5 SITE Centers Corp. CONSOLIDATED STATEMENTS OF EQUITY (unaudited; in thousands) SITE Centers Equity Preferred Shares Common Shares Additional Paid-in Capital Accumulated Distributions in Excess of Net Income Deferred Compensation Obligation Accumulated Other Comprehensive Income Treasury Stock at Cost Non- Controlling Interests Total Balance, December 31, 2022 $ 175,000 $ 21,437 $ 5,974,216 $ ( 4,046,370 ) $ 5,025 $ 9,038 $ ( 51,518 ) $ 5,794 $ 2,092,622 Issuance of common shares related to stock plans — 6 — — — — — 6 Repurchase of common shares — — — — — — ( 26,611 ) — ( 26,611 ) Stock-based compensation, net — — ( 8,133 ) — 30 — 5,094 — ( 3,009 ) Distributions to non-controlling interests — — — — — — — ( 18 ) ( 18 ) Dividends declared-common shares — — — ( 27,292 ) — — — — ( 27,292 ) Dividends declared-preferred shares — — — ( 2,789 ) — — — — ( 2,789 ) Comprehensive income — — — 15,284 — ( 3,200 ) — 18 12,102 Balance, March 31, 2023 $ 175,000 $ 21,437 $ 5,966,089 $ ( 4,061,167 ) $ 5,055 $ 5,838 $ ( 73,035 ) $ 5,794 $ 2,045,011 SITE Centers Equity Preferred Shares Common Shares Additional Paid-in Capital Accumulated Distributions in Excess of Net Income Deferred Compensation Obligation Treasury Stock at Cost Non- Controlling Interests Total Balance, December 31, 2021 $ 175,000 $ 21,129 $ 5,934,166 $ ( 4,092,783 ) $ 4,695 $ ( 5,349 ) $ 5,794 $ 2,042,652 Issuance of common shares related to stock plans — 65 4 — — — — 69 Issuance of common shares for cash offering — 223 33,558 — — — 33,781 Stock-based compensation, net — — 996 — ( 24 ) ( 4,599 ) — ( 3,627 ) Distributions to non-controlling interests — — — — — — ( 18 ) ( 18 ) Dividends declared-common shares — — — ( 27,905 ) — — — ( 27,905 ) Dividends declared-preferred shares — — — ( 2,789 ) — — — ( 2,789 ) Comprehensive income — — — 13,937 — — 18 13,955 Balance, March 31, 2022 $ 175,000 $ 21,417 $ 5,968,724 $ ( 4,109,540 ) $ 4,671 $ ( 9,948 ) $ 5,794 $ 2,056,118 The accompanying notes are an integral part of these condensed consolidated financial statements. 6 SITE Centers Corp. CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited; in thousands) Three Months Ended March 31, 2023 2022 Cash flow from operating activities: Net income $ 15,302 $ 13,955 Adjustments to reconcile net income to net cash flow provided by operating activities: Depreciation and amortization 54,016 50,364 Stock-based compensation 1,760 1,823 Amortization and write-off of debt issuance costs and fair market value of debt adjustments 1,111 1,145 Equity in net income of joint ventures ( 1,359 ) ( 169 ) Operating cash distributions from joint ventures — 883 Gain on sale and change in control of interests ( 3,749 ) ( 3,356 ) (Gain) loss on disposition of real estate, net ( 205 ) 142 Net change in accounts receivable 4,819 6,815 Net change in accounts payable and accrued expenses ( 16,205 ) ( 14,257 ) Net change in other operating assets and liabilities ( 13,323 ) ( 7,324 ) Total adjustments 26,865 36,066 Net cash flow provided by operating activities 42,167 50,021 Cash flow from investing activities: Real estate acquired, net of liabilities and cash assumed ( 26,503 ) ( 133,463 ) Real estate developed and improvements to operating real estate ( 27,990 ) ( 24,725 ) Proceeds from disposition of joint venture interests 3,405 — Proceeds from disposition of real estate — 156 Equity contributions to joint ventures ( 56 ) ( 55 ) Repayment of joint venture advance, net 318 — Distributions from unconsolidated joint ventures — 3,583 Net cash flow used for investing activities ( 50,826 ) ( 154,504 ) Cash flow from financing activities: Proceeds from revolving credit facility, net 75,000 115,000 Repayment of mortgage debt ( 314 ) ( 34,696 ) Proceeds from issuance of common shares, net of offering expenses — 33,781 Repurchase of common shares in conjunction with equity award plans and dividend reinvestment plan ( 4,800 ) ( 5,415 ) Repurchase of common shares ( 26,611 ) — Distributions to non-controlling interests and redeemable operating partnership units ( 18 ) ( 17 ) Dividends paid ( 30,353 ) ( 28,208 ) Net cash flow provided by financing activities 12,904 80,445 Net increase (decrease) in cash, cash equivalents and restricted cash 4,245 ( 24,038 ) Cash, cash equivalents and restricted cash, beginning of period 21,214 43,252 Cash, cash equivalents and restricted cash, end of period $ 25,459 $ 19,214 The accompanying notes are an integral part of these condensed consolidated financial statements. 7 Notes to Condensed Consolid ated Financial Statements 1. Nature of Business and Financial Statement Presentation Nature of Business SITE Centers Corp. and its related consolidated real estate subsidiaries (collectively, the “Company” or “SITE Centers”) and unconsolidated joint ventures are primarily engaged in the business of owning, leasing, acquiring, redeveloping, developing and managing shopping centers. Unless otherwise provided, references herein to the Company or SITE Centers include SITE Centers Corp. and its wholly-owned subsidiaries. The Company’s tenant base includes a mixture of national and regional retail chains and local tenants. Consequently, the Company’s credit risk is primarily concentrated in the retail industry. Use of Estimates in Preparation of Financial Statements The preparation of financial statements in conformity with generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses during the year. Actual results could differ from those estimates. Unaudited Interim Financial Statements These financial statements have been prepared by the Company in accordance with GAAP for interim financial information and the applicable rules and regulations of the Securities and Exchange Commission. Accordingly, they do not include all information and footnotes required by GAAP for complete financial statements. However, in the opinion of management, the interim financial statements include all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of the results of the periods presented. The results of operations for the three months ended March 31, 2023 and 2022, are not necessarily indicative of the results that may be expected for the full year. These condensed consolidated financial statements should be read in conjunction with the Company’s audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 . Principles of Consolidation The consolidated financial statements include the results of the Company and all entities in which the Company has a controlling interest or has been determined to be the primary beneficiary of a variable interest entity. All significant inter-company balances and transactions have been eliminated in consolidation. Investments in real estate joint ventures in which the Company has the ability to exercise significant influence, but does not have financial or operating control, are accounted for using the equity method of accounting. Accordingly, the Company’s share of the earnings (or loss) of these joint ventures is included in consolidated net income (loss). Statements of Cash Flows and Supplemental Disclosure of Non-Cash Investing and Financing Information Non-cash investing and financing activities are summarized as follows (in millions): Three Months Ended March 31, 2023 2022 Consolidation of the net assets of previously unconsolidated joint ventures $ — $ 42.8 Net assets acquired from an unconsolidated joint venture — 8.5 Dividends declared, but not paid 30.1 30.7 Accounts payable related to construction in progress 10.3 10.5 Fee and Other Income Fee and Other Income on the consolidated statements of operations includes revenue from contracts with customers, which is primarily from the Company's unconsolidated joint ventures (Note 2). 8 2. Investments in and Advances to Joint Ventures At March 31, 2023 and December 31, 2022, the Company had ownership interests in various unconsolidated joint ventures that had investments in 15 and 18 shopping center properties, respectively. Condensed combined financial information of the Company’s unconsolidated joint venture investments is as follows (in thousands): March 31, 2023 December 31, 2022 Condensed Combined Balance Sheets Land $ 199,882 $ 212,326 Buildings 607,130 643,334 Fixtures and tenant improvements 67,358 70,636 874,370 926,296 Less: Accumulated depreciation ( 204,892 ) ( 220,642 ) 669,478 705,654 Construction in progress and land 501 1,965 Real estate, net 669,979 707,619 Cash and restricted cash 63,112 44,809 Receivables, net 10,750 11,671 Other assets, net 33,305 36,272 $ 777,146 $ 800,371 Mortgage debt $ 509,168 $ 535,093 Notes and accrued interest payable to the Company 2,827 2,972 Other liabilities 40,392 41,588 552,387 579,653 Accumulated equity 224,759 220,718 $ 777,146 $ 800,371 Company's share of accumulated equity $ 43,437 $ 42,644 Basis differentials ( 442 ) ( 707 ) Deferred development fees, net of portion related to the Company's interest ( 245 ) ( 301 ) Amounts payable to the Company 2,827 2,972 Investments in and Advances to Joint Ventures, net $ 45,577 $ 44,608 Three Months Ended March 31, 2023 2022 Condensed Combined Statements of Operations Revenues from operations $ 24,690 $ 41,649 Expenses from operations: Operating expenses 6,564 11,523 Impairment charges — 5,200 Depreciation and amortization 9,062 14,345 Interest expense 7,041 9,289 Other expense, net 2,560 2,572 25,227 42,929 Loss before gain on disposition of real estate ( 537 ) ( 1,280 ) Gain (loss) on disposition of real estate, net 5,304 ( 98 ) Net income (loss) attributable to unconsolidated joint ventures $ 4,767 $ ( 1,378 ) Company's share of equity in net income of joint ventures $ 950 $ 30 Basis differential adjustments (A) 409 139 Equity in net income of joint ventures $ 1,359 $ 169 (A) The difference between the Company’s share of net income, as reported above, and the amounts included in the Company’s consolidated statements of operations is attributable to the amortization of basis differentials, the recognition of deferred gains and differences in gain (loss) on sale of certain assets recognized due to the basis differentials. 9 Revenues earned by the Company related to all of the Company’s unconsolidated joint ventures are as follows (in millions): Three Months Ended March 31, 2023 2022 Revenue from contracts: Asset and property management fees $ 1.5 $ 2.3 Leasing commissions and development fees 0.1 0.4 1.6 2.7 Other 0.2 0.4 $ 1.8 $ 3.1 Disposition of Shopping Centers During the three months ended March 31, 2023 , the DDRM Joint Venture sold three shopping centers for an aggregate sales price of $ 40.2 million. The proceeds were used to repay mortgage indebtedness of the joint venture and for general corporate purposes of the joint venture. Disposition of Joint Venture Interests In 2021, one of the Company’s unconsolidated joint ventures sold its sole asset, a parcel of undeveloped land. The transaction had contingent proceeds based upon finalization of the tax returns and dissolution of the partnership. In the first quarter of 2023, the contingencies were resolved and the Company recorded a Gain on Sale and Change in Control of Interests of $ 3.7 million. 3. Acquisitions During the three months ended March 31, 2023, the Company acquired the following shopping centers (in millions): Asset Location Date Acquired Purchase Price Parker Keystone Denver, Colorado January 2023 $ 11.0 Foxtail Center Baltimore, Maryland January 2023 15.1 The fair value of the acquisitions above was allocated as follows (in thousands): Weighted-Average Amortization Period (in Years) Land $ 6,860 N/A Buildings 17,188 (A) Tenant improvements 574 (A) In-place leases (including lease origination costs and fair market value of leases) 2,548 6.6 27,170 Less: Below-market leases ( 600 ) 10.5 Less: Other liabilities assumed ( 67 ) N/A Net assets acquired $ 26,503 (A) Depreciated in accordance with the Company’s policy. The total consideration for these assets was paid in cash. Included in the Company’s consolidated statements of operations for the three months ended March 31, 2023, was $ 0.6 million in total revenues from the date of acquisition through March 31, 2023 , for the properties acquired in 2023. 10 4. Other Assets and Intangibles, net Other assets and intangibles consist of the following (in thousands): March 31, 2023 December 31, 2022 Intangible assets: In-place leases, net $ 59,018 $ 61,918 Above-market leases, net 5,755 6,206 Lease origination costs, net 7,915 8,093 Tenant relationships, net 10,849 11,531 Total intangible assets, net (A) 83,537 87,748 Operating lease ROU assets 17,914 18,197 Other assets: Prepaid expenses 19,280 6,721 Swap receivable 5,400 8,138 Other assets 3,704 3,491 Deposits 3,239 3,188 Deferred charges, net 6,976 7,526 Total other assets, net $ 140,050 $ 135,009 Below-market leases, net (other liabilities) $ 58,734 $ 59,825 (A) The Company recorded amortization expense related to its intangibles, excluding above- and below-market leases, of $ 6.2 million and $ 6.6 million for the three months ended March 31, 2023 and 2022 , respectively. 5. Revolving Credit Facility As of March 31, 2023 , the Company’s Revolving Credit Facility (as defined below) had outstanding borrowings of $ 75.0 million with a weighted-average interest rate of 5.7 %. In March 2023, the Company entered into a 5.0 % interest rate cap with respect to the variable rate (the Secured Overnight Financing Rate or "SOFR") component applicable to borrowings up to $ 100 million under the Revolving Credit Facility, of which $ 75.0 million was designated as an effective hedge. The interest rate cap is in effect beginning April 2023 and will expire in April 2024 . The Company maintains a revolving credit facility with a syndicate of financial institutions and JPMorgan Chase Bank, N.A., as administrative agent (the “Revolving Credit Facility”). The Revolving Credit Facility provides for borrowings of up to $ 950 million if certain borrowing conditions are satisfied, and an accordion feature for expansion of availability up to $ 1.45 billion, provided that new lenders agree to the existing terms of the facility or existing lenders increase their commitment level and subject to other customary conditions precedent. The Revolving Credit Facility maturity date is June 2026 subject to two six-month options to extend the maturity to June 2027 upon the Company’s request (subject to satisfaction of certain conditions) . The Company’s borrowin gs under the Revolving Credit Facility bear interest at variable rates at the Company’s election, based on either (i) the SOFR rate plus a 10 basis-point spread adjustment plus an applicable margin ( 0.85 % at March 31, 2023 ) or (ii) the alternative base rate plus an applicable margin ( 0 % at March 31, 2023 ). The Revolving Credit Facility also provides for an annual facility fee, which was 20 basis points on the entire facility at March 31, 2023. The applicable margins and facility fee vary depending on the Company’s long-term senior unsecured debt ratings from Moody’s Investors Service, Inc., S&P Global Ratings and Fitch Investor Services, Inc. (or their respective successors). The Revolving Credit Facility also features a sustainability-linked pricing component whereby the applicable interest rate margin can be adjusted by one or two basis points if the Company meets certain sustainability performance targets. The Company is required to comply with certain covenants under the Revolving Credit Facility relating to total outstanding indebtedness, secured indebtedness, value of unencumbered real estate assets and fixed charge coverage. The Company was in compliance with these financial covenants at March 31, 2023 . 6. Financial Instruments and Fair Value Measurements The following methods and assumptions were used by the Company in estimating fair value disclosures of financial instruments: Measurement of Fair Value At March 31, 2023, the Company used a pay-fixed interest rate swap to manage some of its exposure to changes in benchmark-interest rates. The estimated fair value was determined using the market standard methodology of netting the discounted fixed cash payments and the discounted expected variable cash receipts. The variable cash receipts are based on an expectation of interest rates 11 (forward curves) derived from observable market interest rate curves. In addition, credit valuation adjustments, which consider the impact of any credit enhancements to the contract, are incorporated in the fair value to account for potential non-performance risk, including the Company’s own non-performance risk and the respective counterparty’s non-performance risk. The Company determined that the significant inputs used to value its derivative fell within Level 2 of the fair value hierarchy. Items Measured on Fair Value on a Recurring Basis The Company maintains an interest rate swap agreement (included in Other Assets) measured at fair value on a recurring basis as of March 31, 2023 . The following table presents information about the Company’s financial assets and liabilities and indicates the fair value hierarchy of the valuation techniques used by the Company to determine such fair value (in millions): Fair Value Measurements Assets (Liabilities): Level 1 Level 2 Level 3 Total March 31, 2023 Derivative Financial Instruments $ — $ 5.1 $ — $ 5.1 December 31, 2022 Derivative Financial Instruments $ — $ 8.1 $ — $ 8.1 Cash and Cash Equivalents, Restricted Cash, Accounts Receivable, Accounts Payable and Other Liabilities The carrying amounts reported in the Company's consolidated balance sheets for these financial instruments approximated fair value because of their short-term maturities. Debt The following methods and assumptions were used by the Company in estimating fair value disclosures of debt. The fair market value of senior notes is determined using a pricing model to approximate the trading price of the Company’s public debt. The fair market value for all other debt is estimated using a discounted cash flow technique that incorporates future contractual interest and principal payments and a market interest yield curve with adjustments for duration, optionality and risk profile, including the Company’s non-performance risk and loan to value. The Company’s senior notes and all other debt are classified as Level 2 and Level 3, respectively, in the fair value hierarchy. Considerable judgment is necessary to develop estimated fair values of financial instruments. Accordingly, the estimates presented are not necessarily indicative of the amounts the Company could realize on disposition of the financial instruments. Carrying values that are different from estimated fair values are summarized as follows (in thousands): March 31, 2023 December 31, 2022 Carrying Amount Fair Value Carrying Amount Fair Value Senior Notes $ 1,454,462 $ 1,397,839 $ 1,453,923 $ 1,378,485 Revolving Credit Facility and term loan 273,605 275,000 198,521 200,000 Mortgage Indebtedness 54,201 52,379 54,577 51,936 $ 1,782,268 $ 1,725,218 $ 1,707,021 $ 1,630,421 Risk Management Objective of Using Derivatives The Company is exposed to certain risks arising from both its business operations and economic conditions. The Company principally manages its exposures to a wide variety of business and operational risks through management of its core business activities. The Company manages economic risks, including interest rate, liquidity and credit risk, primarily by managing the amount, sources and duration of its debt funding and, from time to time, through the use of derivative financial instruments. Specifically, the Company enters into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known and uncertain cash amounts, the values of which are determined by interest rates. The Company’s derivative financial instruments are used to manage differences in the amount, timing and duration of the Company’s known or expected cash receipts and its known or expected cash payments principally related to the Company’s borrowings. Cash Flow Hedges of Interest Rate Risk The Company’s objectives in using interest rate derivatives are to manage its exposure to interest rate movements. To accomplish this objective, the Company generally uses swaps and caps as part of its interest rate risk management strategy. The swaps designated as cash flow hedges involve the receipt of variable-rate amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. 12 As of March 31, 2023 , the Company had one effective swap with a notional amount of $ 200.0 million, expiring in June 2027 , which converts the variable-rate SOFR component of the interest rate applicable to its term loan to a fixed rate of 2.75 %. The effective portion of changes in the fair value of derivatives designated, and that qualify, as cash flow hedges is recorded in Accumulated Other Comprehensive Income and is subsequently reclassified into earnings, into interest expense, in the period that the hedged forecasted transaction affects earnings. All components of the swap were included in the assessment of hedge effectiveness. The Company expects to reflect within the next 12 months, a decrease to interest expense (and a corresponding increase to earnings) of approxi mately $ 3.7 million. The Company is exposed to credit risk in the event of non-performance by the counterparty to the swap if the derivative position has a positive balance. The Company believes it mitigates its credit risk by entering into swaps with major financial institutions. The Company continually monitors and actively manages interest costs on its variable-rate debt portfolio and may enter into additional interest rate swap positions or other derivative interest rate instruments based on market conditions. The Company has not entered, and does not plan to enter, into any derivative financial instruments for trading or speculative purposes. Credit Risk-Related Contingent Features The Company has an agreement with the swap counterparty that contains a provision whereby if the Company defaults on certain of its indebtedness, the Company could also be declared in default on the swap, resulting in an acceleration of payment under the swap. 7. Equity Common Share Dividend The Company declared a quarterly cash dividend of $ 0.13 per common share for both the first quarter of 2023 and the first quarter of 2022. Common Shares Repurchased In the first quarter of 2023, the Company r epurchased 1.5 million of its common shares in open market transactions at an aggregate cost of $ 20.0 million, or $ 13.43 per share. 8. Other Comprehensive Income The changes in Accumulated Other Comprehensive Income by component are as follows (in thousands): Balance, December 31, 2022 $ 9,038 Change in cash flow hedges ( 2,269 ) Amounts reclassified from accumulated other comprehensive income to interest expense ( 931 ) Balance, March 31, 2023 (A) $ 5,838 (A) Includes derivative financial instruments entered into by the Company on its term loan (Note 6) and an unconsolidated joint venture. 13 9. Earnings Per Share The following table provides a reconciliation of net income and the number of common shares used in the computations of “basic” earnings per share (“EPS”), which utilizes the weighted-average number of common shares outstanding without regard to dilutive potential common shares, and “diluted” EPS, which includes all such shares (in thousands, except per share amounts). Three Months Ended March 31, 2023 2022 Numerators – Basic and Diluted Net income $ 15,302 $ 13,955 Income attributable to non-controlling interests ( 18 ) ( 18 ) Preferred dividends ( 2,789 ) ( 2,789 ) Earnings attributable to unvested shares and OP units ( 107 ) ( 126 ) Net income attributable to common shareholders after allocation to participating securities $ 12,388 $ 11,022 Denominators – Number of Shares Basic — Average shares outstanding 209,971 212,103 Assumed conversion of dilutive securities: PRSUs 436 1,100 Diluted — Average shares outstanding 210,407 213,203 Earnings Per Share: Basic $ 0.06 $ 0.05 Diluted $ 0.06 $ 0.05 For the three months ended March 31, 2023, Performance Restricted Stock Units (“PRSUs”) issued to certain executives in March 2021 were considered in the computation of diluted EPS and the PRSUs issued in March 2023 and March 2022 were not considered in computing diluted EPS because they were antidilutive. For the three months ended March 31, 2022 , PRSUs issued to certain executives in March 2022, 2021 and 2020 were considered in the computation of diluted EPS. In March 2023, the Company issued 559,559 common shares in settlement of PRSUs granted in 2020. 10. Subsequent Events In April 2023, the Company acquired Barrett Corners in Atlanta, Georgia for $ 15.6 million. 14 Item 2. Management’s Discussion and Analysis o f Financial Condition and Results of OPERATIONS Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) provides readers with a perspective from management on the financial condition, results of operations and liquidity of SITE Centers Corp. and its related consolidated real estate subsidiaries (collectively, the “Company” or “SITE Centers”) and other factors that may affect the Company’s future results. The Company believes it is important to read the MD&A in conjunction with its Annual Report on Form 10-K for the year ended December 31, 2022, as well as other publicly available information. EXECUTIVE SUMMARY The Company is a self-administered and self-managed Real Estate Investment Trust (“REIT”) in the business of owning, leasing, acquiring, redeveloping, developing and managing shopping centers. As of March 31, 2023, the Company’s portfolio consisted of 120 shopping centers (including 15 shopping centers owned through unconsolidated joint ventures). At March 31, 2023, the Company owned approximately 26.6 million square feet of gross leasable area (“GLA”) through all its properties (wholly-owned and joint venture). The following provides an overview of the Company’s key financial metrics (see Non-GAAP Financial Measures described later in this section) (in thousands, except per share amounts): Three Months Ended March 31, 2023 2022 Net income attributable to common shareholders $ 12,495 $ 11,148 FFO attributable to common shareholders $ 61,899 $ 61,226 Operating FFO attributable to common shareholders $ 62,728 $ 61,558 Earnings per share – Diluted $ 0.06 $ 0.05 For the three months ended March 31, 2023, the increase in net income attributable to common shareholders, as compared to the prior-year period, primarily was the result of base rent growth at existing assets, the net impact of property acquisitions and lower general and administrative expenses partially offset by higher depreciation expense, lower fee income from joint ventures and higher interest expense. Company Activity The growth opportunities within the Company’s core property operations include rental rate increases, continued lease-up of the portfolio, and the adaptation of existing site plans and square footage to generate higher blended rental rates and operating cash flows. Additional growth opportunities include external acquisitions and tactical redevelopment. Management intends to use retained cash flow, proceeds from the sale of lower growth assets and proceeds from equity offerings and debt financings to fund capital expenditures relating to new leasing activity, acquisitions, including opportunistic investments, and tactical redevelopment activity. In recent years, the Company’s acquisition activities have largely focused on unanchored, convenience retail properties that offer enhanced prospects for cash flow growth through rent increases and lower capital expenditure requirements. Transactional and investment highlights for the Company through April 26, 2023, include the following: • Acquired two shopping centers for an aggregate purchase price of $26.1 million, including Parker Keystone (Denver, Colorado) for $11.0 million and Foxtail Center (Baltimore, Maryland) for $15.1 million. In April 2023, the Company acquired Barrett Corners in Atlanta, Georgia for $15.6 million. • Sold three unconsolidated shopping centers for an aggregate sales price of $40.2 million. • Repurchased 1.5 million of its common shares in open market transactions at an aggregate cost of $20.0 million, or $13.43 per share with the remaining proceeds from the sale of wholly‑owned properties in the fourth quarter of 2022 and proceeds from the sale of joint venture properties. Company Operational Highlights First quarter 2023 operational highlights include the following: • Leased approximately 0.5 million square feet of GLA, including 32 new leases and 62 renewals for a total of 94 leases. As of March 31, 2023, the remaining 2023 lease expirations aggregated approximately 0.6 million square feet of GLA 15 (representing approximately 45% of total annualized base rent of 2023 expiring as of December 31, 2022), as compared to 1.2 million square feet of GLA as of December 31, 2022; • For the comparable leases executed in the three months ended March 31, 2023, the Company generated cash lease spreads on a pro rata basis of 20.3% for new leases and 8.7% for renewals. Leasing spreads are a key metric in real estate, representing the percentage increase of rental rates on new and renewal leases over rental rates on existing leases, though leasing spreads exclude consideration of the amount of capital expended in connection with new leasing activity. The Company’s cash lease spreads calculation includes only those deals that were executed within one year of the date the prior tenant vacated, in addition to other factors that limit comparability, and as a result, is a useful benchmark to compare the average annualized base rent of expiring leases with the comparable executed market rental rates; • Total portfolio average annualized base rent per square foot increased to $19.65 at March 31, 2023 as compared to $19.52 at December 31, 2022 and $18.55 at March 31, 2022, all on a pro rata basis; • The aggregate occupancy of the Company’s operating shopping center portfolio was 92.8% at March 31, 2023 as compared to 92.4% at December 31, 2022 and 90.2% at March 31, 2022, all on a pro rata basis and • For new leases executed in the three months ended March 31, 2023, the Company expended a weighted-average cost of tenant improvements and lease commissions estimated at $5.67 per rentable square foot, on a pro rata basis, over the lease term, as compared to $7.42 per rentable square foot in 2022. The Company generally does not expend a significant amount of capital on lease renewals. RESULTS OF OPERATIONS Consolidated shopping center properties owned as of January 1, 2022, are referred to herein as the “Comparable Portfolio Properties.” Revenues from Operations (in thousands) Three Months Ended March 31, 2023 2022 $ Change Rental income (A) $ 135,872 $ 129,884 $ 5,988 Fee and other income (B) 2,820 4,436 (1,616 ) Total revenues $ 138,692 $ 134,320 $ 4,372 (A) The following tables summarize the key components of the rental income (in thousands): Three Months Ended March 31, Contractual Lease Payments 2023 2022 $ Change Base and percentage rental income (1) $ 98,454 $ 94,224 $ 4,230 Recoveries from tenants (2) 35,316 32,833 2,483 Uncollectible revenue (3) 233 1,108 (875 ) Lease termination fees, ancillary and other rental income 1,869 1,719 150 Total contractual lease payments $ 135,872 $ 129,884 $ 5,988 (1) The changes in base and percentage rental income for the three months ended March 31, 2023, were due to the following (in millions): Increase (Decrease) Acquisition of shopping centers $ 4.9 Comparable Portfolio Properties 3.3 Disposition of shopping centers (3.7 ) Straight-line rents (0.3 ) Total $ 4.2 16 At March 31, 2023 and 2022, the Company owned 105 and 92 wholly-owned properties, respectively, with an aggregate occupancy rate of 92.9% and 90.2%, respectively, and average annualized base rent per occupied square foot of $19.71 and $18.74, respectively. (2) Recoveries from tenants were approximately 81.7% and 78.0% of operating expenses and real estate taxes for the three months ended March 31, 2023 and 2022, respectively. (3) The net amount reported as income was primarily attributable to rental income paid from tenants on the cash basis of accounting and related reserve adjustments. This rental income was contractually owed in prior years. (B) Fee and Other Income was primarily earned from the Company's unconsolidated joint ventures. The decrease primarily relates to lower fee revenue from joint ventures as a result of asset sales. Decreases in the number of assets under management will adversely impact the amount of revenue recorded in future periods. The Company’s joint venture partners may also elect to terminate their joint venture arrangements with the Company in connection with a change in investment strategy or otherwise. See “—Sources and Uses of Capital” included elsewhere herein. Expenses from Operations (in thousands) Three Months Ended March 31, 2023 2022 $ Change Operating and maintenance (A) $ 23,166 $ 21,936 $ 1,230 Real estate taxes (A) 20,053 20,183 (130 ) General and administrative (B) 10,645 12,251 (1,606 ) Depreciation and amortization (A) 54,016 50,364 3,652 $ 107,880 $ 104,734 $ 3,146 (A) The changes for the three months ended March 31, 2023, were due to the following (in millions): Operating and Maintenance Real Estate Taxes Depreciation and Amortization Acquisition of shopping centers $ 1.1 $ 0.9 $ 3.5 Comparable Portfolio Properties 0.9 — 2.5 Disposition of shopping centers (0.8 ) (1.0 ) (2.3 ) $ 1.2 $ (0.1 ) $ 3.7 The increase in depreciation for the Comparable Portfolio Properties was primarily the result of the change in useful life of several assets. (B) General and administrative expenses for the three months ended March 31, 2023 and 2022, were approximately 6.5% and 6.9% of total revenues (excluding uncollectible revenue), respectively, including total revenues of unconsolidated joint ventures for the comparable periods. The decrease is primarily attributable to lower compensation expense due to changes in the Company’s workforce. The Company continues to expense certain internal leasing salaries, legal salaries and related expenses associated with leasing space. Other Income and Expenses (in thousands) Three Months Ended March 31, 2023 2022 $ Change Interest expense (A) $ (19,923 ) $ (18,258 ) $ (1,665 ) Other expense, net (687 ) (504 ) (183 ) $ (20,610 ) $ (18,762 ) $ (1,848 ) 17 (A) The weighted-average debt outstanding and related weighted-average interest rate are as follows: Three Months Ended March 31, 2023 2022 Weighted-average debt outstanding (in billions) $ 1.8 $ 1.7 Weighted-average interest rate 4.3 % 4.0 % The Company’s overall balance sheet strategy is to continue to maintain substantial liquidity, prudent leverage levels and lengthy average debt maturities. The weighted-average interest rate (based on contractual rates and excluding fair market value of adjustments and debt issuance costs) was 4.2% and 3.8% at March 31, 2023 and 2022, respectively. At March 31, 2023, the weighted-average maturity (without extensions) was 2.9 years. Interest costs capitalized in conjunction with redevelopment projects were $0.3 million and $0.2 million for the three months ended March 31, 2023 and 2022, respectively. Other Items (in thousands) Three Months Ended March 31, 2023 2022 $ Change Equity in net income of joint ventures (A) $ 1,359 $ 169 $ 1,190 Gain on sale and change in control of interests (B) 3,749 3,356 393 Gain (loss) on disposition of real estate, net 205 (142 ) 347 Tax expense of taxable REIT subsidiaries and state franchise and income taxes (213 ) (252 ) 39 Income attributable to non-controlling interests, net (18 ) (18 ) — (A) The 2023 results include gains recorded on the sale of assets offset by the reduction of income as a result of asset sales occurring in 2023 and 2022. At March 31, 2023 and 2022, the Company had an economic investment in unconsolidated joint ventures which owned 15 and 46 shopping center properties, respectively. Joint venture property sales could significantly impact the amount of income or loss recognized in future periods. See Note 2, “Investments in and Advances to Joint Ventures,” in the Company’s consolidated financial statements included herein. (B) In 2023, the Company recorded a gain related to additional proceeds received related to an unconsolidated joint venture that sold a parcel of undeveloped land in Richmond Hill, Ontario which was considered contingent at the time of the sale. In 2022, the Company recorded a gain from the acquisition of its joint venture partner's 80% equity interest in one asset owned by the DDRM Joint Venture. Net Income (in thousands) Three Months Ended March 31, 2023 2022 $ Change Net income attributable to SITE Centers $ 15,284 $ 13,937 $ 1,347 The increase in net income attributable to SITE Centers, as compared to the prior-year period, was primarily attributable to base rent growth at existing assets, the net impact of property acquisitions and lower general and administrative expenses, partially offset by higher depreciation expense, lower fee income from joint ventures and higher interest expense. NON-GAAP FINANCIAL MEASURES Funds from Operations and Operating Funds from Operations Definition and Basis of Presentation The Company believes that Funds from Operations (“FFO”) and Operating FFO, both non-GAAP financial measures, provide additional and useful means to assess the financial performance of REITs. FFO and Operating FFO are frequently used by the real estate industry, as well as securities analysts, investors and other interested parties, to evaluate the performance of REITs. The Company also believes that FFO and Operating FFO more appropriately measure the core operations of the Company and provide benchmarks to its peer group. 18 FFO excludes GAAP historical cost depreciation and amortization of real estate and real estate investments, which assume that the value of real estate assets diminishes ratably over time. Historically, however, real estate values have risen or fallen with market conditions, and many companies use different depreciable lives and methods. Because FFO excludes depreciation and amortization unique to real estate and gains and losses from property dispositions, it can provide a performance measure that, when compared year over year, reflects the impact on operations from trends in occupancy rates, rental rates, operating costs, interest costs and acquisition, disposition and development activities. This provides a perspective of the Company’s financial performance not immediately apparent from net income determined in accordance with GAAP. FFO is generally defined and calculated by the Company as net income (loss) (computed in accordance with GAAP), adjusted to exclude (i) preferred share dividends, (ii) gains and losses from disposition of real estate property and related investments, which are presented net of taxes, (iii) impairment charges on real estate property and related investments, (iv) gains and losses from changes in control and (v) certain non-cash items. These non-cash items principally include real property depreciation and amortization of intangibles, equity income (loss) from joint ventures and equity income (loss) from non-controlling interests and adding the Company’s proportionate share of FFO from its unconsolidated joint ventures and non-controlling interests, determined on a consistent basis. The Company’s calculation of FFO is consistent with the definition of FFO provided by the National Association of Real Estate Investment Trusts ("NAREIT"). The Company believes that certain charges, income and gains recorded in its operating results are not comparable or reflective of its core operating performance. Operating FFO is useful to investors as the Company removes non-comparable charges, income and gains to analyze the results of its operations and assess performance of the core operating real estate portfolio. As a result, the Company also computes Operating FFO and discusses it with the users of its financial statements, in addition to other measures such as net income (loss) determined in accordance with GAAP and FFO. Operating FFO is generally defined and calculated by the Company as FFO excluding certain charges, income and gains that management believes are not comparable and indicative of the results of the Company’s operating real estate portfolio. Such adjustments include write-off of preferred share original issuance costs, gains/losses on the early extinguishment of debt, certain transaction fee income, transaction costs and other restructuring type costs. The disclosure of these adjustments is regularly requested by users of the Company’s financial statements. The adjustment for these charges, income and gains may not be comparable to how other REITs or real estate companies calculate their results of operations, and the Company’s calculation of Operating FFO differs from NAREIT’s definition of FFO. Additionally, the Company provides no assurances that these charges, income and gains are non-recurring. These charges, income and gains could be reasonably expected to recur in future results of operations. These measures of performance are used by the Company for several business purposes and by other REITs. The Company uses FFO and/or Operating FFO in part (i) as a disclosure to improve the understanding of the Company’s operating results among the investing public, (ii) as a measure of a real estate asset company’s performance, (iii) to influence acquisition, disposition and capital investment strategies and (iv) to compare the Company’s performance to that of other publicly traded shopping center REITs. For the reasons described above, management believes that FFO and Operating FFO provide the Company and investors with an important indicator of the Company’s operating performance. They provide recognized measures of performance other than GAAP net income, which may include non-cash items (often significant). Other real estate companies may calculate FFO and Operating FFO in a different manner. Management recognizes the limitations of FFO and Operating FFO when compared to GAAP’s net income. FFO and Operating FFO do not represent amounts available for dividends, capital replacement or expansion, debt service obligations or other commitments and uncertainties. Management does not use FFO or Operating FFO as an indicator of the Company’s cash obligations and funding requirements for future commitments, acquisitions or development activities. Neither FFO nor Operating FFO represents cash generated from operating activities in accordance with GAAP, and neither is necessarily indicative of cash available to fund cash needs. Neither FFO nor Operating FFO should be considered an alternative to net income (computed in accordance with GAAP) or as an alternative to cash flow as a measure of liquidity. FFO and Operating FFO are simply used as additional indicators of the Company’s operating performance. The Company believes that to further understand its performance, FFO and Operating FFO should be compared with the Company’s reported net income (loss) and considered in addition to cash flows determined in accordance with GAAP, as presented in its consolidated financial statements. Reconciliations of these measures to their most directly comparable GAAP measure of net income (loss) have been provided below. 19 Reconciliation Presentation FFO and Operating FFO attributable to common shareholders were as follows (in thousands): Three Months Ended March 31, 2023 2022 $ Change FFO attributable to common shareholders $ 61,899 $ 61,226 $ 673 Operating FFO attributable to common shareholders 62,728 61,558 1,170 The increase in FFO for the three months ended March 31, 2023, as compared to the prior-year period, was primarily attributable to higher operating results driven by base rent growth at existing assets, the net impact of property acquisitions and lower general and administrative expenses, partially offset by lower management fees from joint ventures and higher interest expense. The change in Operating FFO primarily was due to the same drivers impacting FFO. The Company’s reconciliation of net income attributable to common shareholders computed in accordance with GAAP to FFO attributable to common shareholders and Operating FFO attributable to common shareholders is as follows (in thousands). The Company provides no assurances that these charges and gains are non-recurring. These charges and gains could reasonably be expected to recur in future results of operations: Three Months Ended March 31, 2023 2022 Net income attributable to common shareholders $ 12,495 $ 11,148 Depreciation and amortization of real estate investments 52,717 49,128 Equity in net income of joint ventures (1,359 ) (169 ) Joint ventures' FFO (A) 1,982 4,315 Non-controlling interests (OP Units) 18 18 Gain on sale and change in control of interests (3,749 ) (3,356 ) (Gain) loss on disposition of real estate, net (205 ) 142 FFO attributable to common shareholders 61,899 61,226 Transaction, debt extinguishment and other (at SITE's share) 829 332 Non-operating items, net 829 332 Operating FFO attributable to common shareholders $ 62,728 $ 61,558 (A) At March 31, 2023 and 2022, the Company had an economic investment in unconsolidated joint ventures which owned 15 and 46 shopping center properties, respectively. These joint ventures represent the investments in which the Company recorded its share of equity in net income or loss and, accordingly, FFO and Operating FFO. Joint ventures’ FFO and Operating FFO are summarized as follows (in thousands): Three Months Ended March 31, 2023 2022 Net income (loss) attributable to unconsolidated joint ventures $ 4,767 $ (1,378 ) Depreciation and amortization of real estate investments 9,062 14,345 Impairment of real estate — 5,200 (Gain) loss on disposition of real estate, net (5,304 ) 98 FFO $ 8,525 $ 18,265 FFO at SITE Centers' ownership interests $ 1,982 $ 4,315 Operating FFO at SITE Centers' ownership interests $ 2,148 $ 4,315 Net Operating Income and Same Store Net Operating Income Definition and Basis of Presentation The Company uses Net Operating Income (“NOI”), which is a non-GAAP financial measure, as a supplemental performance measure. NOI is calculated as property revenues less property-related expenses. The Company believes NOI provides useful information to investors regarding the Company’s financial condition and results of operations because it reflects only those income 20 and expense items that are incurred at the property level and, when compared across periods, reflects the impact on operations from trends in occupancy rates, rental rates, operating costs and acquisition and disposition activity on an unleveraged basis. The Company also presents NOI information on a same store basis, or Same Store Net Operating Income (“SSNOI”). The Company defines SSNOI as property revenues less property-related expenses, which exclude straight-line rental income (including reimbursements) and expenses, lease termination income, management fee expense, fair market value of leases and expense recovery adjustments. SSNOI includes assets owned in comparable periods (15 months for quarter comparisons). In addition, SSNOI excludes all non-property and corporate level revenue and expenses. Other real estate companies may calculate NOI and SSNOI in a different manner. The Company believes SSNOI at its effective ownership interest provides investors with additional information regarding the operating performances of comparable assets because it excludes certain non-cash and non-comparable items as noted above. SSNOI is frequently used by the real estate industry, as well as securities analysts, investors and other interested parties, to evaluate the performance of REITs. SSNOI is not, and is not intended to be, a presentation in accordance with GAAP. SSNOI information has its limitations as it excludes any capital expenditures associated with the re-leasing of tenant space or as needed to operate the assets. SSNOI does not represent amounts available for dividends, capital replacement or expansion, debt service obligations or other commitments and uncertainties. Management does not use SSNOI as an indicator of the Company’s cash obligations and funding requirements for future commitments, acquisitions or development activities. SSNOI does not represent cash generated from operating activities in accordance with GAAP and is not necessarily indicative of cash available to fund cash needs. SSNOI should not be considered as an alternative to net income (computed in accordance with GAAP) or as an alternative to cash flow as a measure of liquidity. A reconciliation of NOI and SSNOI to their most directly comparable GAAP measure of net income (loss) is provided below. Reconciliation Presentation The Company’s reconciliation of net income computed in accordance with GAAP to NOI and SSNOI for the Company at 100% and at its effective ownership interest of the assets is as follows (in thousands): For the Year Ended March 31, 2023 2022 2023 2022 At 100% At the Company's Interest Net income attributable to SITE Centers $ 15,284 $ 13,937 $ 15,284 $ 13,937 Fee income (1,859 ) (3,261 ) (1,859 ) (3,261 ) Interest expense 19,923 18,258 19,923 18,258 Depreciation and amortization 54,016 50,364 54,016 50,364 General and administrative 10,645 12,251 10,645 12,251 Other expense (income), net 687 504 687 504 Equity in net income of joint ventures (1,359 ) (169 ) (1,359 ) (169 ) Tax expense 213 252 213 252 Gain on sale and change in control of interests (3,749 ) (3,356 ) (3,749 ) (3,356 ) (Gain) loss on disposition of real estate, net (205 ) 142 (205 ) 142 Income from non-controlling interests 18 18 18 18 Consolidated NOI $ 93,614 $ 88,940 $ 93,614 $ 88,940 Net income from unconsolidated joint ventures $ 4,767 $ (1,378 ) $ 1,004 $ 26 Interest expense 7,041 9,289 1,587 2,088 Depreciation and amortization 9,062 14,345 2,091 3,179 Impairment charges — 5,200 — 1,040 Other expense (income), net 2,560 2,572 574 597 (Gain) loss on disposition of real estate, net (5,304 ) 98 (1,062 ) 66 Unconsolidated NOI $ 18,126 $ 30,126 $ 4,194 $ 6,996 Total Consolidated + Unconsolidated NOI $ 97,808 $ 95,936 Less: Non-Same Store NOI adjustments (5,210 ) (7,048 ) Total SSNOI including redevelopment $ 92,598 $ 88,888 SSNOI % Change including redevelopment 4.2 % The SSNOI increase for the three months ended March 31, 2023, as compared to the prior-year period, primarily related to increases in rents and recoveries attributable to sequential increases in occupancy for same-store assets. 21 LIQUIDITY, CAPITAL RESOURCES AND FINANCING ACTIVITIES The Company periodically evaluates opportunities to issue and sell additional debt or equity securities, obtain credit facilities from lenders or repurchase or refinance long-term debt as part of its overall strategy to further strengthen its financial position. The Company remains committed to monitoring liquidity and the duration of its indebtedness and to maintaining prudent leverage levels in an effort to manage its overall risk profile. The Company’s consolidated and unconsolidated debt obligations generally require monthly or semi-annual payments of principal and/or interest over the term of the obligation. While the Company currently believes it has several viable sources to obtain capital and fund its business, including capacity under its Revolving Credit Facility, no assurance can be provided that these obligations will be refinanced or repaid as currently anticipated. Any new debt financings may also entail higher rates of interest than the indebtedness being refinanced, which could have an adverse effect on the Company’s operations. The Company has historically accessed capital sources through both the public and private markets. Acquisitions and redevelopments are generally financed through cash provided from operating activities, the Revolving Credit Facility, mortgages assumed, secured debt, unsecured debt, common and preferred equity offerings, joint venture capital and asset sales. Total consolidated debt outstanding was $1.8 billion at March 31, 2023, compared to $1.7 billion at December 31, 2022. At March 31, 2023, the Company had an unrestricted cash balance of $25.0 million and availability under its Revolving Credit Facility of $875.0 million (subject to satisfaction of applicable borrowing conditions). The Company has $87.2 million aggregate principal amount of senior notes maturing in May 2023. In 2024, the Company has $65.6 million aggregate principal amount of senior notes and $27.8 million of consolidated mortgage debt maturing. The Company's unconsolidated joint ventures have $17.0 million and $88.9 million in mortgage debt at the Company's share maturing in 2023 and 2024, respectively. As of March 31, 2023, the Company anticipates that it has approximately $20 million to be incurred on its pipeline of identified redevelopment projects. The Company declared a common share dividend of $0.13 per share in the three months ended March 31, 2023. The Company believes it has sufficient liquidity to operate its business at this time. In March 2023, the Company entered into a 5.0% interest rate cap with respect to the variable rate (the Secured Overnight Financing Rate or "SOFR") component applicable to borrowings up to $100 million under the Company's Revolving Credit Facility, which interest rate cap is in effect for one year beginning April 2023. At March 31, 2023, the Company had $75.0 million drawn on the Revolving Credit Facility. Revolving Credit Facility The Company maintains an unsecured Revolving Credit Facility with a syndicate of financial institutions and JPMorgan Chase Bank, N.A., as administrative agent that provides for borrowings of up to $950 million, which limit may be increased to $1.45 billion provided that existing or new lenders agree to provide incremental commitments and subject to other conditions precedent. The Revolving Credit Facility matures in June 2026 subject to two six-month options to extend the maturity to June 2027 at the Company's option (subject to the satisfaction of certain conditions). The Company’s borrowings under the Revolving Credit Facility bear interest at variable rates at the Company’s election, based on either (i) the SOFR rate plus a 10-basis point credit spread adjustment plus an applicable margin (0.85% at March 31, 2023) or (ii) the alternative base rate plus an applicable margin (0% at March 31, 2023). The Revolving Credit Facility also provides for an annual facility fee, which was 20 basis points on the entire facility at March 31, 2023. The applicable margins and facility fee vary depending on the Company’s long-term senior unsecured debt ratings from Moody’s, S&P Global Ratings (“S&P”) and Fitch (or their respective successors). The Revolving Credit Facility also features a sustainability-linked pricing component whereby the applicable interest-rate margin can be adjusted by one or two basis points if the Company meets certain sustainability performance targets. The Revolving Credit Facility, the Company's $200.0 million term loan facility and the indentures under which the Company’s senior and subordinated unsecured indebtedness are, or may be, issued contain certain financial and operating covenants including, among other things, leverage ratios and debt service coverage and fixed-charge coverage ratios, as well as limitations on the Company’s ability to incur secured and unsecured indebtedness, sell all or substantially all of the Company’s assets and engage in certain mergers and acquisitions. The Revolving Credit Facility, the term loan and the indentures also contain customary default provisions including the failure to make timely payments of principal and interest payable thereunder, the failure to comply with the Company’s financial and operating covenants and the failure of the Company or its majority-owned subsidiaries (i.e., entities in which the Company has a greater than 50% interest) to pay, when due, certain indebtedness in excess of certain thresholds beyond applicable grace and cure periods. In the event the Company’s lenders or note holders declare a default, as defined in the applicable agreements governing the debt, the Company may be unable to obtain further funding, and/or an acceleration of any outstanding borrowings may occur. As of March 31, 2023, the Company was in compliance with all of its financial covenants in the agreements governing its debt. Although the Company believes it will continue to operate in compliance with these covenants, if the Company were to violate these covenants, the Company may be subject to higher finance costs and fees or accelerated maturities. 22 Consolidated Indebtedness – as of March 31, 2023 As discussed above, the Company is committed to maintaining prudent leverage levels and may utilize proceeds from the sale of properties or other investments or equity offerings to repay additional debt. These sources of funds could be affected by various risks and uncertainties. No assurance can be provided that the Company’s debt obligations will be refinanced or repaid as currently anticipated. See Item 1A. Risk Factors in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. The Company continually evaluates its debt maturities and, based on management’s assessment, believes it has viable financing and refinancing alternatives. The Company has sought to manage its debt maturities through executing a strategy to extend debt duration, increase liquidity, maintain prudent leverage levels and improve the Company’s credit profile with a focus of lowering the Company's balance sheet risk and cost of capital. Unconsolidated Joint Ventures’ Mortgage Indebtedness – as of March 31, 2023 The outstanding indebtedness of the Company’s unconsolidated joint ventures at March 31, 2023, which matures in the subsequent 13-month period (i.e., through April 30, 2024), is as follows (in millions): Outstanding at March 31, 2023 At SITE Centers' Share DDR Domestic Retail Fund I (A) $ 84.2 $ 16.8 Dividend Trust Portfolio (B) 364.3 72.9 Total debt maturities through April 30, 2024 $ 448.5 $ 89.7 (A) The joint venture expects to exercise a one-year extension option and to repay indebtedness with proceeds from future asset sales. (B) Expected to be refinanced. No assurance can be provided that these obligations will be refinanced or repaid as currently anticipated. Any future deterioration in property-level revenues may cause one or more of these joint ventures to be unable to refinance maturing obligations or satisfy applicable covenants, financial tests or debt service requirements or loan maturity extension conditions in the future, thereby allowing the mortgage lender to assume control of property cash flows, limit distributions of cash to joint venture members, declare a default, increase the interest rate or accelerate the loan’s maturity. In addition, rising interest rates may adversely impact the ability of the Company's joint ventures to sell assets at attractive prices in order to repay indebtedness. Cash Flow Activity The Company’s cash flow activities are summarized as follows (in thousands): Three Months Ended March 31, 2023 2022 Cash flow provided by operating activities $ 42,167 $ 50,021 Cash flow used for investing activities (50,826 ) (154,504 ) Cash flow provided by financing activities 12,904 80,445 Changes in cash flow for the three months ended March 31, 2023, compared to the prior comparable period, are as follows: Operating Activities: Cash provided by operating activities decreased $7.9 million primarily due to the following: • Cash used for prepaid assets including insurance and • Increase in cash flow from acquired properties and base rent growth at existing assets. Investing Activities: Cash used for investing activities decreased $103.7 million primarily due to the following: • Decrease in real estate assets acquired, developed and improved of $103.7 million. Financing Activities: Cash provided by financing activities decreased $67.5 million primarily due to the following: • Changes in proceeds from issuance of common shares in 2022 of $33.8 million and cash used for repurchases of common shares in 2023 of $26.6 million and • Decrease in borrowings from the Revolving Credit Facility, net of mortgage debt repayments of $5.6 million. 23 Dividend Distribution The Company declared common and preferred cash dividends of $30.1 million and $30.7 million for the three months ended March 31, 2023 and 2022, respectively. The Company intends to distribute at least 100% of ordinary taxable income in the form of common and preferred dividends with respect to the year ending December 31, 2023 in order to maintain compliance with REIT requirements and in order to not incur federal income taxes (excluding federal income taxes applicable to its taxable REIT subsidiary activities). The Company declared a quarterly cash dividend of $0.13 per common share for the first quarter of 2023. The Board of Directors of the Company intends to monitor the Company’s dividend policy in order to maintain sufficient liquidity for operations and in order to maximize the Company’s free cash flow while still adhering to REIT payout requirements. SITE Centers’ Equity In December 2022, the Company’s Board of Directors authorized a common share repurchase program. Under the terms of the program, the Company is authorized to repurchase up to a maximum value of $100 million of its common shares. In the first quarter of 2023, the Company repurchased 1.5 million of its common shares in open market transactions at an aggregate cost of $20.0 million, or $13.43 per share. Through March 31, 2023, the Company had repurchased under this program 2.0 million of its common shares in open market transactions at an aggregate cost of $26.6 million. SOURCES AND USES OF CAPITAL Strategic Transaction Activity The Company remains committed to maintaining sufficient liquidity, managing debt duration and maintaining prudent leverage levels in an effort to manage its overall risk profile. Equity offerings, debt financings, asset sales and cash flow from operations continue to represent a potential source of proceeds to be used to achieve these objectives. Acquisitions In the first quarter of 2023, the Company acquired Parker Keystone (Denver, Colorado) for $11.0 million and Foxtail Center (Baltimore, Maryland) for $15.1 million. In April 2023, the Company acquired Barrett Corners (Atlanta, Georgia) for $15.6 million. Dispositions In the first quarter of 2023, the DDRM Joint Venture sold three unconsolidated shopping centers generating proceeds totaling $40.2 million. The proceeds from these sales were used to repay mortgage indebtedness of the joint venture and for general corporate purposes of the joint venture. Changes in investment strategies for assets may impact the Company’s hold-period assumptions for those properties. The disposition of certain assets could result in a loss or impairment recorded in future periods. The Company evaluates all potential sale opportunities taking into account the long-term growth prospects of the assets, the use of proceeds and the impact to the Company’s balance sheet, in addition to the impact on operating results. Equity Transactions In the first quarter of 2023, the Company repurchased 1.5 million of its common shares in open market transactions at an aggregate cost of $20.0 million, or $13.43 per share with the remaining proceeds from the sale of wholly-owned properties in the fourth quarter of 2022 and proceeds from the sale of joint venture properties. 24 Redevelopment Pipeline One component of the Company’s long-term strategic plan will be the evaluation of additional tactical redevelopment potential within the portfolio, particularly as it relates to the efficient use of the underlying real estate, which includes to expand, improve and re-tenant various properties. The Company generally expects to commence construction on redevelopment projects only after substantial tenant leasing has occurred. At March 31, 2023, the Company had approximately $57 million in construction in progress in various active consolidated redevelopments and other projects and anticipates that it has approximately $20 million yet to be incurred on its pipeline of identified redevelopment projects. At March 31, 2023, the Company’s shopping center expansions, outparcel developments, construction of first-generation space and repurposing projects, were as follows (in thousands): Location Estimated Stabilized Quarter Estimated Cost Cost Incurred at March 31, 2023 West Bay Plaza - Phase II (Cleveland, Ohio) 4Q23 $ 7,941 $ 6,672 Carolina Pavilion (Charlotte, North Carolina) 4Q23 2,339 2,123 Shoppers World (Boston, Massachusetts) 4Q23 4,967 4,471 Nassau Park Pavilion (Trenton, New Jersey) 1Q24 7,635 4,237 University Hills (Denver, Colorado) 2Q24 5,972 4,894 Shoppers World (Boston, Massachusetts) 2Q24 1,884 552 Tanasbourne Town Center (Portland, Oregon) 4Q25 13,769 1,972 Perimeter Pointe (Atlanta, Georgia) TBD — 1,407 Total $ 44,507 $ 26,328 CAPITALIZATION At March 31, 2023, the Company’s capitalization consisted of $1.8 billion of debt, $175.0 million of preferred shares and $2.6 billion of market equity (calculated as the sum of common shares and OP Units outstanding multiplied by $12.28, the closing price of the Company’s common shares on the New York Stock Exchange at March 31, 2023). At March 31, 2023, after giving effect to the swap of the variable-rate component of the term loan's interest rate to a fixed rate, the Company’s total debt consisted of $1.7 billion of fixed-rate debt and $75.0 million of variable rate debt. Management’s strategy is to maintain access to the capital resources necessary to manage the Company’s balance sheet and to repay upcoming maturities. Accordingly, the Company may seek to obtain funds through additional debt or equity financings and/or joint venture capital in a manner consistent with its intention to operate with a prudent debt capitalization policy and to reduce the Company’s cost of capital by maintaining an investment grade rating with Moody’s, S&P and Fitch. A security rating is not a recommendation to buy, sell or hold securities, as it may be subject to revision or withdrawal at any time by the rating organization. Each rating should be evaluated independently of any other rating. The Company may not be able to obtain financing on favorable terms, or at all, which may negatively affect future ratings. The Revolving Credit Facility, term loan and the indentures under which the Company’s senior and subordinated unsecured indebtedness is, or may be, issued contain certain financial and operating covenants, including, among other things, debt service coverage and fixed charge coverage ratios, as well as limitations on the Company’s ability to incur secured and unsecured indebtedness, sell all or substantially all of the Company’s assets, engage in certain mergers and acquisitions and make distribution to its shareholders. Although the Company intends to operate in compliance with these covenants, if the Company were to violate these covenants, the Company may be subject to higher finance costs and fees or accelerated maturities. In addition, the Revolving Credit Facility, term loan and the Company’s indentures permit the acceleration of maturity in the event certain other debt of the Company is in default or has been accelerated. Foreclosure on mortgaged properties or an inability to refinance existing indebtedness would have a negative impact on the Company’s financial condition and results of operations. CONTRACTUAL OBLIGATIONS AND OTHER COMMITMENTS As of March 31, 2023, the Company has $87.2 million aggregate principal amount of senior notes maturing in May 2023. In 2024, the Company has $65.6 million aggregate principal amount of senior notes and $27.8 million of consolidated mortgage debt maturing. The Company expects to fund future maturities from utilization of its Revolving Credit Facility, proceeds from asset sales and other investments, cash flow from operations and/or additional debt or equity financings. No assurance can be provided that these obligations will be repaid as currently anticipated or refinanced. 25 Other Guaranties In conjunction with the redevelopment of shopping centers, the Company had entered into commitments with general contractors aggregating approximately $23.5 million for its consolidated properties at March 31, 2023, which includes the assets in the redevelopment pipeline. These obligations, composed principally of construction contracts, are generally due within 12 to 24 months, as the related construction costs are incurred, and are expected to be financed through operating cash flow, asset sales or borrowings under the Revolving Credit Facility. These contracts typically can be changed or terminated without penalty. The Company routinely enters into contracts for the maintenance of its properties. These contracts typically can be canceled upon 30 to 60 days’ notice without penalty. At March 31, 2023, the Company had purchase order obligations, typically payable within one year, aggregating approximately $7.4 million related to the maintenance of its properties and general and administrative expenses. ECONOMIC CONDITIONS Despite growing economic uncertainty, the Company continues to experience retailer demand for quality real estate locations within well-positioned shopping centers. The Company executed new leases and renewals aggregating approximately 0.5 million square feet of space on a pro rata basis for the three months ended March 31, 2023. The Company believes these strong leasing results and tenant demand are attributable to the concentration of the Company’s portfolio in suburban, high household income communities, pandemic-induced work-from-home trends, limited new construction and tenants’ increasing use of physical store locations to improve the speed and efficiency of merchandise distribution. The Company benefits from a diversified tenant base, with only one tenant whose annualized rental revenue equals or exceeds 3% of the Company’s annualized consolidated revenues plus the Company’s proportionate share of unconsolidated joint venture revenues (TJX Companies at 5.9%). Other significant national tenants generally have relatively strong financial positions, have outperformed other retail categories over time and the Company believes remain well-capitalized. Historically these national tenants have provided a stable revenue base, and the Company believes that they will continue to provide a stable revenue base going forward, given the long-term nature of these leases. The majority of the tenants in the Company’s shopping centers provide day-to-day consumer necessities with a focus on value and convenience, versus discretionary items, which the Company believes will enable many of its tenants to outperform under a variety of economic conditions. The Company recognizes the risks posed by current economic conditions but believes the position of its portfolio and the general diversity and credit quality of its tenant base should enable it to successfully navigate through a potentially challenging economic environment. The Company has relatively little reliance on overage or percentage rents generated by tenant sales performance. The Company believes that its shopping center portfolio is well positioned, as evidenced by its recent leasing activity, historical property income growth and consistent growth in average annualized base rent per occupied square foot. Historical occupancy has generally ranged from 89% to 94% over the last 10 years. At March 31, 2023 and December 31, 2022, the shopping center portfolio occupancy, on a pro rata basis, was 92.8% and 92.4%, respectively, and the total portfolio average annualized base rent per occupied square foot, on a pro rata basis, was $19.65 and $19.52, respectively. The Company’s portfolio was impacted by tenant bankruptcies and closures in 2020, primarily due to the impact of the COVID-19 pandemic, and the Company expects to expend capital in coming periods in connection with recently executed leases to backfill these closures. Although the per square foot cost of leasing capital expenditures has been predominantly consistent with the Company’s historical trends, the high volume of the Company’s recent leasing activity will cause aggregate leasing capital expenditure levels to be elevated. The weighted-average cost of tenant improvements and lease commissions estimated to be incurred over the expected lease term for new leases executed during the three months ended March 31, 2023 and 2022, on a pro rata basis, was $5.67 and $7.47 per rentable square foot, respectively. The Company generally does not expend a significant amount of capital on lease renewals. Although disruptions to the Company's business stemming from the COVID-19 pandemic have subsided, inflation, higher interest rates, reduced consumer spending, labor shortages, supply chain disruptions and the volatility of global capital markets pose increasing risks to the U.S. economy and the Company's tenants. In addition to these macroeconomic challenges, the retail sector has been affected by changing consumer behaviors following the COVID-19 pandemic, including the competitive nature of the retail business and the competition for the share of the consumer wallet. The Company routinely monitors the credit profiles of its tenants and analyzes the possible impact of any potential tenant credit issues on the financial statements of the Company and its unconsolidated joint ventures. In some cases, changing conditions have resulted in weaker retailers and retail categories losing market share and declaring bankruptcy and/or closing stores. However, other retailers, specifically those in the value and convenience category, continue to express interest in launching new concepts and expanding their store fleets within the suburban, high household income communities in which the Company's properties are located. As a result, the Company believes that its prospects to backfill any spaces vacated by bankrupt or non-renewing tenants are generally good, though such re-tenanting efforts would likely require additional capital expenditures and the opportunities to lease any vacant theater spaces may be more limited. However, there can be no assurance that vacancy resulting from increasingly uncertain economic conditions will not adversely affect the Company's operating results (see Item 1A. Risk Factors in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022). 26 Inflation, rising interest rates and regional bank concerns have also impacted, in certain cases, real estate owners' ability to acquire and sell assets and raise equity and debt financing. Although the Company has relatively small amounts of consolidated indebtedness maturing in 2023 and 2024, debt capital markets could adversely impact the Company’s ability to refinance maturities and the interest rates applicable thereto. To the extent that the interest rate environment does not moderate prior to the time of these refinancings, the Company’s interest expense levels would be adversely affected. FORWARD-LOOKING STATEMENTS MD&A should be read in conjunction with the Company’s consolidated financial statements and the notes thereto appearing elsewhere in this report. Historical results and percentage relationships set forth in the Company’s consolidated financial statements, including trends that might appear, should not be taken as indicative of future operations. The Company considers portions of this information to be “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, both as amended, with respect to the Company’s expectations for future periods. Forward-looking statements include, without limitation, statements related to acquisitions (including any related pro forma financial information) and other business development activities, future capital expenditures, financing sources and availability and the effects of environmental and other regulations. Although the Company believes that the expectations reflected in these forward-looking statements are based upon reasonable assumptions, it can give no assurance that its expectations will be achieved. For this purpose, any statements contained herein that are not statements of historical fact should be deemed to be forward-looking statements. Without limiting the foregoing, the words “will,” “believes,” “anticipates,” “plans,” “expects,” “seeks,” “estimates” and similar expressions are intended to identify forward-looking statements. Readers should exercise caution in interpreting and relying on forward-looking statements because such statements involve known and unknown risks, uncertainties and other factors that are, in some cases, beyond the Company’s control and that could cause actual results to differ materially from those expressed or implied in the forward-looking statements and that could materially affect the Company’s actual results, performance or achievements. For additional factors that could cause the results of the Company to differ materially from those indicated in the forward-looking statements see Item 1A. Risk Factors in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. Factors that could cause actual results, performance or achievements to differ materially from those expressed or implied by forward-looking statements include, but are not limited to, the following: • The Company is subject to general risks affecting the real estate industry, including the need to enter into new leases or renew leases on favorable terms to generate rental revenues, and any economic downturn may adversely affect the ability of the Company’s tenants, or new tenants, to enter into new leases or the ability of the Company’s existing tenants to renew their leases at rates at least as favorable as their current rates; • The Company could be adversely affected by changes in the local markets where its properties are located, as well as by adverse changes in national economic and market conditions; • The Company may fail to anticipate the effects on its properties of changes in consumer buying practices, including sales over the internet and the resulting retailing practices and space needs of its tenants, or a general downturn in its tenants’ businesses, which may cause tenants to close stores or default in payment of rent; • The Company is subject to competition for tenants from other owners of retail properties, and its tenants are subject to competition from other retailers and methods of distribution. The Company is dependent upon the successful operations and financial condition of its tenants, in particular its major tenants, and could be adversely affected by the bankruptcy of those tenants; • The Company leases the majority of its square footage to large tenants, which makes it vulnerable to changes in the business and financial condition of, or demand for its space by, such tenants; • The Company may not realize the intended benefits of acquisition or merger transactions. The acquired assets may not perform as well as the Company anticipated, or the Company may not successfully integrate the assets and realize improvements in occupancy and operating results. The acquisition of certain assets may subject the Company to liabilities, including environmental liabilities; • The Company may fail to identify, acquire, construct or develop additional properties that produce a desired yield on invested capital, or may fail to effectively integrate acquisitions of properties or portfolios of properties. In addition, the Company may be limited in its acquisition opportunities due to competition, the inability to obtain financing on reasonable terms or any financing at all and other factors; • The Company may fail to dispose of properties on favorable terms, especially in regions experiencing deteriorating economic conditions. In addition, real estate investments can be illiquid, particularly as prospective buyers may experience 27 increased costs of financing or difficulties obtaining financing due to local or global conditions, and could limit the Company’s ability to promptly make changes to its portfolio to respond to economic and other conditions; • The Company may abandon a development or redevelopment opportunity after expending resources if it determines that the opportunity is not feasible due to a variety of factors, including a lack of availability of construction financing on reasonable terms, the impact of the economic environment on prospective tenants’ ability to enter into new leases or pay contractual rent, or the inability of the Company to obtain all necessary zoning and other required governmental permits and authorizations; • The Company may not complete development or redevelopment projects on schedule as a result of various factors, many of which are beyond the Company’s control, such as weather, labor conditions, governmental approvals, material shortages or general economic downturn, resulting in limited availability of capital, increased debt service expense and construction costs and decreases in revenue; • The Company’s financial condition may be affected by required debt service payments, the risk of default, restrictions on its ability to incur additional debt or to enter into certain transactions under its Revolving Credit Facility and term loan and other documents governing its debt obligations and the risk of downgrades from debt rating services. In addition, the Company may encounter difficulties in obtaining permanent financing or refinancing existing debt. Borrowings under the Company’s Revolving Credit Facility are subject to certain representations and warranties and no default or event of default existing thereunder; • Changes in interest rates could adversely affect the market price of the Company’s common shares, its ability to sell properties and prices realized, as well as its performance, interest expense levels and cash flow; • Debt and/or equity financing necessary for the Company to continue to grow and operate its business may not be available or may not be available on favorable terms; • Disruptions in the financial markets could affect the Company’s ability to obtain financing on reasonable terms and have other adverse effects on the Company and the market price of the Company’s common shares; • Inflationary pressures could result in reductions in retailer profitability, consumer discretionary spending and tenant demand to lease space. Inflation could also increase the costs incurred by the Company to operate its properties and finance its operations and could adversely impact the valuation of its properties, all of which could have an adverse effect on the market price of the Company's common shares; • The Company is subject to complex regulations related to its status as a REIT and would be adversely affected if it failed to qualify as a REIT; • The Company must make distributions to shareholders to continue to qualify as a REIT, and if the Company must borrow funds to make distributions, those borrowings may not be available on favorable terms or at all; • Joint venture investments may involve risks not otherwise present for investments made solely by the Company, including the possibility that a partner or co-venturer may become bankrupt, may at any time have interests or goals different from those of the Company and may take action contrary to the Company’s instructions, requests, policies or objectives, including the Company’s policy with respect to maintaining its qualification as a REIT. In addition, a partner or co‑venturer may not have access to sufficient capital to satisfy its funding obligations to the joint venture or may seek to terminate the joint venture, resulting in a loss to the Company of property revenues and management fees. The partner could cause a default under the joint venture loan for reasons outside the Company’s control. Furthermore, the Company could be required to reduce the carrying value of its equity investments if a loss in the carrying value of the investment is realized; • The Company’s decision to dispose of real estate assets, including undeveloped land and construction in progress, would change the holding period assumption in the undiscounted cash flow impairment analyses, which could result in material impairment losses and adversely affect the Company’s financial results; • The outcome of pending or future litigation, including litigation with tenants or joint venture partners, may adversely affect the Company’s results of operations and financial condition; • Property damage, expenses related thereto, and other business and economic consequences (including the potential loss of revenue) resulting from extreme weather conditions or natural disasters in locations where the Company owns properties may adversely affect the Company’s results of operations and financial condition; 28 • Sufficiency and timing of any insurance recovery payments related to damages and lost revenues from extreme weather conditions or natural disasters may adversely affect the Company’s results of operations and financial condition; • The Company and its tenants could be negatively affected by the impacts of pandemics (including the COVID-19 pandemic) and other public health crises; • The Company is subject to potential environmental liabilities; • The Company may incur losses that are uninsured or exceed policy coverage due to its liability for certain injuries to persons, property or the environment occurring on its properties; • The Company could be subject to potential liabilities, increased costs, reputation harm and other adverse effects on the Company's business due to stakeholders', including regulators', views regarding the Company's environmental, social and governance goals and initiatives, and the impact of factors outside of our control on such goals and initiatives; • The Company could incur additional expenses to comply with or respond to claims under the Americans with Disabilities Act or otherwise be adversely affected by changes in government regulations, including changes in environmental, zoning, tax and other regulations; • Changes in accounting standards or other standards may adversely affect the Company’s business; • The Company’s Board of Directors, which regularly reviews the Company’s business strategy and objectives, may change the Company’s strategic plan based on a variety of factors and conditions, including in response to changing market conditions and • The Company and its vendors could sustain a disruption, failure or breach of their respective networks and systems, including as a result of cyber-attacks, which could disrupt the Company’s business operations, compromise the confidentiality of sensitive information and result in fines or penalties. Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK The Company’s primary market risk exposure is interest rate risk. At March 31, 2023, the Company’s debt, excluding unconsolidated joint venture debt and adjusted to reflect the swap of the variable rate (SOFR) component of interest rate applicable to the Company's $200.0 million term loan to a fixed rate of 2.75%, is summarized as follows: March 31, 2023 December 31, 2022 Amount (Millions) Weighted- Average Maturity (Years) Weighted- Average Interest Rate Percentage of Total Amount (Millions) Weighted- Average Maturity (Years) Weighted- Average Interest Rate Percentage of Total Fixed-Rate Debt $ 1,707.3 2.8 4.1 % 95.8 % $ 1,707.0 3.1 4.1 % 100.0 % Variable-Rate Debt $ 75.0 3.2 5.7 % 4.2 % $ — — — 0.0 % The Company’s unconsolidated joint ventures’ indebtedness at its carrying value is summarized as follows: March 31, 2023 December 31, 2022 Joint Venture Debt (Millions) Company's Proportionate Share (Millions) Weighted- Average Maturity (Years) Weighted- Average Interest Rate Joint Venture Debt (Millions) Company's Proportionate Share (Millions) Weighted- Average Maturity (Years) Weighted- Average Interest Rate Fixed-Rate Debt $ 363.7 $ 72.7 1.0 4.8 % $ 363.5 $ 72.7 1.3 4.8 % Variable-Rate Debt $ 145.5 $ 32.7 1.0 5.1 % $ 171.6 $ 37.9 1.1 5.4 % The Company intends to use retained cash flow, proceeds from asset sales, equity and debt financing and variable-rate indebtedness available under its Revolving Credit Facility to repay indebtedness and fund capital expenditures at the Company’s shopping centers. Thus, to the extent the Company incurs additional variable-rate indebtedness or needs to refinance existing fixed-rate indebtedness in a rising interest rate environment, its exposure to increases in interest rates in an inflationary period could increase. 29 The interest rate risk on a portion of the Company’s variable-rate debt has been mitigated through the use of an interest rate swap agreement with major financial institutions. At March 31, 2023, the variable (SOFR) component of the interest rate applicable to the Company's $200.0 million consolidated term loan facility was swapped to a fixed rate. The Company is exposed to credit risk in the event of nonperformance by the counterparties to the swaps. The Company believes it mitigates its credit risk by entering into swaps with major financial institutions. The carrying value of the Company’s fixed-rate debt is adjusted to include the $200.0 million of variable-rate debt that was swapped to a fixed rate at March 31, 2023. An estimate of the effect of a 100 basis-point increase at March 31, 2023 and December 31, 2022, is summarized as follows (in millions): March 31, 2023 December 31, 2022 Carrying Value Fair Value 100 Basis-Point Increase in Market Interest Rate Carrying Value Fair Value 100 Basis-Point Increase in Market Interest Rate Company's fixed-rate debt $ 1,707.3 $ 1,645.1 (A) $ 1,603.3 (B) $ 1,707.0 $ 1,622.2 (A) $ 1,577.7 (B) Company's proportionate share of joint venture fixed-rate debt $ 72.7 $ 71.0 $ 70.3 $ 72.7 $ 70.5 $ 69.6 (A) Includes the fair value of the swap, which was an asset of $5.1 million and $8.2 million at March 31, 2023 and December 31, 2022, respectively. (B) Includes the fair value of the swap, which was an asset of $12.2 million and $15.6 million at March 31, 2023 and December 31, 2022, respectively. The sensitivity to changes in interest rates of the Company’s fixed-rate debt was determined using a valuation model based upon factors that measure the net present value of such obligations that arise from the hypothetical estimate as discussed above. A 100 basis-point increase in short-term market interest rates at March 31, 2023, would result in an increase in interest expense of approximately $0.2 million relating to the Company's variable rate debt outstanding for the three months ended March 31, 2023. This exposure to interest rate risk was mitigated by the implementation of a 5.0% interest rate cap with respect to the variable (SOFR) component applicable to borrowings up to $100 million under the Company's Revolving Credit Facility effective in April 2023. The estimated increase in interest expense does not give effect to possible changes in the daily balance of the Company’s outstanding variable-rate debt. A 100 basis-point increase in short-term market interest rates on variable-rate debt at March 31, 2023, would not result in any change in interest expense for the Company or its joint ventures. All of the variable-rate debt outstanding at the unconsolidated joint ventures is subject to hedging agreements. The Company and its joint ventures intend to continually monitor and actively manage interest costs on their variable-rate debt portfolio and may enter into swap positions based on market fluctuations. In addition, the Company believes it has the ability to obtain funds through additional equity and/or debt offerings and joint venture capital. Accordingly, the cost of obtaining such protection agreements versus the Company’s access to capital markets will continue to be evaluated. The Company has not entered, and does not plan to enter, into any derivative financial instruments for trading or speculative purposes. As of March 31, 2023, the Company had no other material exposure to market risk. Item 4. CONTROL S AND PROCEDURES The Company’s management, with the participation of the Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), conducted an evaluation, pursuant to Securities Exchange Act of 1934 Rules 13a-15(b) and 15d-15(b), of the effectiveness of our disclosure controls and procedures. Based on their evaluation as required, the CEO and CFO have concluded that the Company’s disclosure controls and procedures (as defined in Securities Exchange Act Rules 13a-15(e) and 15d-15(e)) were effective as of the end of the period covered by this Quarterly Report on Form 10-Q to ensure that information required to be disclosed by the Company in reports that it files or submits under the Securities Exchange Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms and were effective as of the end of such period to ensure that information required to be disclosed by the Company in reports that it files or submits under the Securities Exchange Act is accumulated and communicated to the Company’s management, including its CEO and CFO, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. During the three months ended March 31, 2023, there were no changes in the Company’s internal control over financial reporting that materially affected or are reasonably likely to materially affect the Company’s internal control over financial reporting. 30 PART II OTHER INFORMATION Item 1. LEGAL PROCEEDINGS The Company and its subsidiaries are subject to various legal proceedings, which, taken together, are not expected to have a material adverse effect on the Company. The Company is also subject to a variety of legal actions for personal injury or property damage arising in the ordinary course of its business, most of which are covered by insurance. While the resolution of all matters cannot be predicted with certainty, management believes that the final outcome of such legal proceedings and claims will not have a material adverse effect on the Company’s liquidity, financial position or results of operations. Item 1A. RI SK FACTORS None. Item 2. UNREGISTERED SALES OF EQUIT Y SECURITIES AND USE OF PROCEEDS ISSUER PURCHASES OF EQUITY SECURITIES (a) (b) (c) (d) Total Number of Shares Purchased (1) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs (Millions) January 1–31, 2023 134 $ 13.66 — $ — February 1–28, 2023 1,145,147 13.39 1,068,666 — March 1–31, 2023 706,239 13.41 420,410 — Total 1,851,520 $ 13.40 1,489,076 $ 73.4 (1) Includes (i) common shares surrendered or deemed surrendered to the Company to satisfy statutory minimum tax withholding obligations in connection with the vesting and/or exercise of awards under the Company’s equity-based compensation plans and (ii) common shares purchased under the Company's share repurchase program. On December 20, 2022, the Company announced that its Board of Directors authorized a common share repurchase program. Under the terms of the program, the Company is authorized to repurchase up to a maximum value of $100 million of its common shares. In the first quarter of 2023, the Company repurchased 1.5 million of its common shares in open market transactions at an aggregate cost of $20.0 million, or $13.43 per share, under this program. From December 20, 2022 through March 31, 2023, the Company had repurchased 2.0 million of its common shares in the aggregate at a cost of $26.6 million under the program. Item 3. DEFAULTS UPO N SENIOR SECURITIES None. Item 4. MINE SAF ETY DISCLOSURES Not applicable. Item 5. OTHER INFORMATION None. 31 Item 6. E XHIBITS 31.1 Certification of principal executive officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934 1 31.2 Certification of principal financial officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934 1 32.1 Certification of chief executive officer pursuant to Rule 13a-14(b) of the Securities Exchange Act of 1934 and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of this report pursuant to the Sarbanes-Oxley Act of 2002 1,2 32.2 Certification of chief financial officer pursuant to Rule 13a-14(b) of the Securities Exchange Act of 1934 and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of this report pursuant to the Sarbanes-Oxley Act of 2002 1,2 101.INS Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document 1 101.SCH Inline XBRL Taxonomy Extension Schema Document 1 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document 1 101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document 1 101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document 1 101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document 1 104 The cover page from the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2023 has been formatted in Inline XBRL and included in Exhibit 101. 1. Submitted electronically herewith. 2. Pursuant to SEC Release No. 34-4751, these exhibits are deemed to accompany this report and are not “filed” as part of this report Attached as Exhibit 101 to this report are the following formatted in iXBRL (Inline Extensible Business Reporting Language): (i) Consolidated Balance Sheets as of March 31, 2023 and December 31, 2022, (ii) Consolidated Statements of Operations for the Three Months Ended March 31, 2023 and 2022, (iii) Consolidated Statements of Comprehensive Income for the Three Months Ended March 31, 2023 and 2022, (iv) Consolidated Statements of Equity for the Three Months Ended March 31, 2023 and 2022, (v) Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2023 and 2022 and (vi) Notes to Condensed Consolidated Financial Statements. 32 SIGNAT URES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. SITE CENTERS CORP. By: /s/ Christa A. Vesy Name: Christa A. Vesy Title: Executive Vice President and Chief Accounting Officer (Principal Accounting Officer) Date: April 27, 2023 33